FYI: Have you seen that interest rates are rising on some certificates of deposit, only to worry that you’ll miss out on further increases? You may want to consider putting your cash in several C.D.s with different terms — what’s known as building a C.D. ladder.
“It’s time to take C.D. ladders out of the attic,” said Chris Horymski, senior research analyst at the financial site MagnifyMoney.
C.D. ladders are a way to hedge your bet on interest rates. Longer-term C.D.s typically pay higher interest than short-term certificates. So, for example, if you had $50,000, you could buy five $10,000 C.D.s, with terms of one, two, three, four and five years. When the one-year certificate matures, you could reinvest that cash in another five-year C.D. — hopefully, at a higher rate — or use the money for something else. Meanwhile, the other certificates would be earning higher, longer-term rates.
Regards,
Ted
https://www.nytimes.com/2019/03/08/your-money/cd-interest-rates.html
